Arlington, Virginia-based AES, one of the world's leading power companies, and its Vietnamese partner PV Gas have secured a licence to build a US$1.4 billion liquefied natural gas ( LNG ) terminal in southern Vietnam to support the country’s energy transition.

Vietnam’s Minister of Investment and Planning Nguyen Chi Dung presented the investment certificate to AES executive vice-president and chief executive officer Bernerd Da Santos and PV Gas president and CEO Hoang Van Quang during a ceremony in Washington on May 11, witnessed by visiting Vietnamese Prime Minister Pham Minh Chinh and US Secretary of Commerce Gina Raimondo.

The certificate serves as a key enabler for the two companies to establish the Son My LNG terminal company as a joint venture to develop the project in Binh Thuan province’s Ham Tan District, about 3.5 hours’ drive from Ho Chi Minh City, Vietnam’s southern economic hub.

“This is an important milestone for the development of the terminal, which will supply LNG to southern Vietnam and play a major role in shaping Vietnam’s energy future by diversifying the energy mix with imported LNG,” says AES Vietnam president David Stone.

AES and PV Gas, the gas industry unit of the Vietnam Gas and Oil Group ( PetroVietnam ), expect to achieve financial completion for the project in 2023 and begin commercial operations by 2026.

The terminal will have a capacity of 3.6 million tonnes a year in the first phase and up to 9 million tonnes in the next phase.

In November 2017, AES signed a memorandum of understanding with PV Gas to co-develop the project. Two years later, AES signed another MoU with the Vietnamese Ministry of Industry and Trade to develop a 2.2-gigawatt combined cycle gas turbine power plant under a build-operate-transfer scheme, which will also be incorporated into the Son My LNG-to-power complex.

Also in Vietnam, AES, through its subsidiary AES Mong Duong Power Company Limited, has developed the 1,242-megawatt Mong Duong 2 Power Project with a total investment of around US$2.1 billion in the northern province of Quang Ninh.